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..... Morning..

I'm exhausted, yesterdays trading was amazing... RBS says they have no more write downs.. we may get more optimism in the banks....

the KRE was up 1% even higher than the XLF... I think the money center banks are going to have a hell of a time raising capital, and most of it just goes to reserve requirements. the Regional have exposure to bad loans, but they can be foreclosed on, and some money can be recovered, as opposed to the nastiness the the money center and Ibanks are in for for the next years.

also the regionals will take market share from the big banks.... That is my thesis....

hmmmm....What else......

oh, why "its never different this time".... the micro cycles will still be the same, even though I believe this is a Super cycle... the super cycle says this will go on for a few years...

Materials/Consumer Sector rotation,
As the materials loose their Alpha from the rate cuts, the Banks generate Alpha from the widening credit spread. Borrow at the fed rate, loan at the 10 year. What will happen is that the banks will become a momentum trade in the next few days/weeks go to far, then come back again. There should be some choppy trade.
the real boost will be when rates are Raised. Hopefully we will get some global slow down.. and our economy will become stronger..
The ECB probably won't raise rates.... I just think there will be enough pressure to keep them soft on rates.... and with oil coming back to 100-110 it will elevate inflation pressures.... Near Term.

Transports... I was looking at them yesterday... and they look like they should catch a bid soon.....
seems like a good trade. EXM DRYS The P/E were in the 30's when I was looking at them last... probably down in the 20s now.